Tesla Inc (NASDAQ: TSLA) is in focus on Monday after announcing plans of setting up a battery factory in Shanghai, China.
Timeline for the new megapack factory
The said facility will boost the company’s production capacity by 10,000 megapacks per year.
In 2022, Tesla generated about $10 billion worth of non-automotive sales (up 52% YoY) that include storage. Its new megapack factory is expected to break ground in the back half of 2023 and production could start in the second quarter of next year.
Today’s announcement arrives only days after the billionaire Elon Musk led EV company reiterated its commitment to reaching a sustainable global energy economy in its “Master Plan 3”.
Tesla shares are trading down this morning because data showed that sales of passenger cars at large in China climbed only 0.3% last month versus a whopping 10.4% growth in February.
Should you buy Tesla shares?
Tesla Inc had record deliveries in its fiscal first quarter as Invezz reported HERE. Still, it again lowered prices of its vehicles between 2.0% and about 6.0% in the United States today.
That, as per a JPMorgan analyst, is a meaningful headwind for its stock. Last week, Ryan Brinkman reiterated his “sell” rating on Tesla shares. His $120 price target suggests more than a 30% downside from here.
The analyst says consensus margin expectations are way too high considering Tesla continues to trim prices. Lower prices, he expects, will hit margins moving forward that will translate to a weaker stock price.
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